Correlation Between Hecla Mining and MetLife
Can any of the company-specific risk be diversified away by investing in both Hecla Mining and MetLife at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Hecla Mining and MetLife into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hecla Mining and MetLife, you can compare the effects of market volatilities on Hecla Mining and MetLife and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Hecla Mining with a short position of MetLife. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hecla Mining and MetLife.
Diversification Opportunities for Hecla Mining and MetLife
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hecla and MetLife is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Hecla Mining and MetLife in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MetLife and Hecla Mining is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Hecla Mining are associated (or correlated) with MetLife. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MetLife has no effect on the direction of Hecla Mining i.e., Hecla Mining and MetLife go up and down completely randomly.
Pair Corralation between Hecla Mining and MetLife
Allowing for the 90-day total investment horizon Hecla Mining is expected to generate 4.16 times more return on investment than MetLife. However, Hecla Mining is 4.16 times more volatile than MetLife. It trades about 0.3 of its potential returns per unit of risk. MetLife is currently generating about 0.06 per unit of risk. If you would invest 354.00 in Hecla Mining on January 20, 2024 and sell it today you would earn a total of 174.00 from holding Hecla Mining or generate 49.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hecla Mining vs. MetLife
Performance |
| Timeline |
| Hecla Mining |
| MetLife |
Hecla Mining and MetLife Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hecla Mining and MetLife
The main advantage of trading using opposite Hecla Mining and MetLife positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hecla Mining position performs unexpectedly, MetLife can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in MetLife will offset losses from the drop in MetLife's long position.| Hecla Mining vs. SilverCrest Metals | Hecla Mining vs. Avino Silver Gold | Hecla Mining vs. New Pacific Metals | Hecla Mining vs. Gatos Silver |
| MetLife vs. Lincoln National | MetLife vs. Aflac Incorporated | MetLife vs. Unum Group | MetLife vs. Manulife Financial Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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